According to the North Carolina Association of Certified Public Accountants (NCACPA) Director of Advocacy, Robert Broome, CAE, this past week, the North Carolina (NC) legislature is still working on the proposed changes for Payroll Protection Plan (PPP) expense deductibility. The NC House and NC Senate have yet to work out a compromise related to their versions of each bill. The House’s version would allow businesses to deduct PPP associated expenses for the covered period. The House also expands its coverage of deductible expenses to other federal pandemic relief efforts such as emergency and targeted Economic Injury Disaster Loan advances, loans under the Debt Relief Program, grants for Shuttered Venue Operators, and Restaurant Revitalization grants.
See Robert’s articles on the NCACPA website page for Advocacy and Legislative Issues.
House Rolls Out Tax Plan
Appropriations Bill Clears House
The Senate version would not allow the expense deductibility for these programs, but would create a separate grant program to distribute grants for these and other federal and state programs. The JOBS grants and Tax Relief Bill is summarized in the link below.
Senate Passes JOBS Grants and Tax Relief Bill
Other items likely to be covered in the changes are related to the taxability of unemployment received during 2020, hopefully to conform to the federal income exclusion amount of $10,200.
It will take some time to work out the differences, but legislative leaders hope to have an agreement worked out by the end of August.
The PPP provisions and taxability of unemployment benefits are the two most pressing issues as they affect many 2020 tax returns.
Other items of interest will be forthcoming in future articles once the differences in the state budget process are worked out.
Submitted by: Vickie Martin, Managing Partner
Source: North Carolina Association of Certified Public Accountants